Unassociated Document


    
      SECOND
AMENDED AND RESTATED

      SUPPLEMENTAL
RETIREMENT AGREEMENT

       

      THIS SECOND AMENDED AND RESTATED
SUPPLEMENTAL RETIREMENT AGREEMENT (the “Agreement”) is made as of
December 11, 2009 by and between ATLANTIC COAST BANK (the
“Bank”), its successors and assigns and CARL W. INSEL. (the
“Executive”).  The original agreement, which was last amended and
restated effective January 1, 2006, is being amended and restated to make
certain changes to the Agreement’s vesting and benefit calculation
provisions.

       

      
        	
                1.

              	
                Definitions.

              	
                In
      this Agreement, the following words and phrases shall have the following
      meanings:

              


      

       

      
        	
                 
      

              	
                (a)

              	
                Prior
      Benefit Component shall mean a number of shares of Company Stock
      equal to the Executive’s benefit under the Agreement as of December 11,
      2009, divided by the Fair Market Value of Company Stock on December 11,
      2009.  For example, the Executive’s prior benefit under the
      terms of the Agreement on December 11, 2009 was $40,000 and the Fair
      Market Value of Company Stock on December 11, 2009 was
      $2.00.  The Executive is deemed to have, for purposes of the
      Agreement, 20,000 shares of Company Stock ($40,000/$2.00) in the Prior
      Benefit Component.

              


      

       

      
        	
                 
      

              	
                (b)

              	
                Administrator
      shall mean the person or committee appointed by the Board of Directors of
      the Bank to administer this Agreement. If a committee is appointed by the
      Board of Directors, a majority of those persons shall constitute a quorum
      and the act of the majority of such of persons either at a meeting or by
      written consent, shall be the act of the Administrator. The administrator
      may adopt such rules and procedures, not inconsistent with this Agreement,
      as it deems necessary or appropriate in order to administer this
      Agreement.

              


      

       

      
        	
                 
      

              	
                (c)

              	
                Appreciation
      Benefit shall mean an amount equal to the Prior Benefit Component
      plus the Stock Award Component plus the Stock Ownership Component
      multiplied by the Issue Price (as defined below) multiplied by the
      Exchange Ratio (as defined below).  For example, if the
      Executive’s Prior Benefit Component had 20,000 shares of Company Stock,
      the Stock Award Component had 30,000 shares of Company Stock and the Stock
      Ownership Component had 25,000 shares of Company Stock; the Issue Price
      was $10.00 and the Exchange Ratio was 60 percent, then the Executive’s
      Appreciation Benefit would be equal to $450,000
      [(20,000+30,000+25,000)($10.00)(.6)].  The Company will pay
      interest on unpaid balance of the Executive’s Appreciation Benefit at the
      rate of three percent per annum.

              


      

       

      
        
           


        

        
           


          
            

          

        

        
           


        

      


      In the
event the Executive dies, becomes Disabled, incurs an Involuntary Termination or
there is a Change in Control prior to the date of closing of the Second-Step
Conversion, the Fair Market Value of the Company Stock as of the date of death,
determination of Disability, Involuntary Termination or Change in Control will
be substituted for the Issue Price and the Exchange Ratio.  For
example, the Executive incurs an Involuntary Termination prior to the closing of
the Second-Step Conversion.  The Fair Market Value of the Company
Stock on that date is $4.00 per share.  In this instance, the
Executive’s Appreciation Benefit is $300,000
[(20,000+30,000+$25,000)*$4.00].  The Company will pay interest on
unpaid balance of the Executive’s Appreciation Benefit at the rate of three
percent per annum.

       

      The
Executive shall vest in his Appreciation Benefit upon the earliest to occur of
(i) the closing date of a Second-Step Conversion, (ii) the Executive’s
Involuntary Termination, (iii) a Change in Control, (iv) the Executive’s death,
(v) the Executive’s Disability or (vi) the date the Administrator, in its sole
discretion, accelerates vesting.  Notwithstanding the preceding
provisions, if the Executive resigns at the request of, or is removed from
service by, the Office of Thrift Supervision, Federal Deposit Insurance
Corporation or any other regulatory authority for the Bank, the Executive shall
be ineligible to participate and shall forfeit any benefits under this
Agreement.

       

      
        	
                 
      

              	
                (d)

              	
                Benefit
      Determination Date shall mean any of the following: (1) the
      Executive’s Normal Retirement Date; (2) the date the Executive incurs an
      Involuntary Termination prior to the Executive’s Normal Retirement Date;
      (3) the date of the Executive’s death; (4) the date the Executive incurs a
      Disability; or (5) the date of a Change in
  Control.

              


      

       

      
        	
                 
      

              	
                (e)

              	
                Cause
      shall mean a Separation from Service due to the Executive’s personal
      dishonesty, incompetence, willful misconduct, breach of fiduciary duty
      involving personal profit, intentional failure to perform stated duties,
      and willful violation of any law, rule, or regulation (other than traffic
      violations or similar offenses) or final cease-and-desist
      order.

              


      

       

      
        	
                 
      

              	
                (f)

              	
                Change
      in Control shall mean the
      following:

              


      

       

      (1)    A
“change in the ownership” of the Bank or Atlantic Coast Federal Corporation (the
“Company”), a “change in the effective control” of the Bank or the Company, or a
“change in the ownership of a substantial portion of the assets” of the Bank or
the Company, each described below.  Notwithstanding anything herein to
the contrary, a Second-Step Conversion shall not be deemed a Change in
Control.

       

      (2)    A
“change in ownership” occurs on the date that anyone person, or more than one
person acting as a group (as defined in Treasury Regulation Section
1.409A-3(i)(5)(v)(B)), acquires ownership of stock of the Bank or Company that,
together with stock held by such person or group, constitutes more than 50
percent of the total fair market value or total voting power of the stock of
such corporation.


      
        
           


        

        
          2

          
            

          

        

        
           


        

      


      (3)           A
“change in the effective control” of the Bank or Company occurs on the date that
either (A) anyone person, or more than one person acting as a group (as defined
in Treasury Regulation Section 1.409A-3(i)(5)(vi)(B)) acquires (or has acquired
during the 12-month period ending on the date of the most recent acquisition by
such person or persons) ownership of stock of the Bank or Company possessing 30
percent or more of the total voting power of the stock of the Bank or Company,
or (B) a majority of the members of the Bank’s or Company’s board of directors
is replaced during any 12-month period by directors whose appointment or
election is not endorsed by a majority of the members of the Bank’s or Company’s
board of directors prior to the date of the appointment or election, provided
that this subsection (B) is inapplicable where a majority shareholder of the
Bank or Company is another corporation.

       

      (4)           A
“change in a substantial portion of the assets” of the Bank or the Company
occurs on the date that anyone person or more than one person acting as a group
(as defined in Treasury Regulation Section 1.409A-3(i)(5)(vii)(C)) acquires (or
has acquired during the 12-month period ending on the date of the most recent
acquisition by such person or persons) assets from the Bank or Company that have
a total gross fair market value equal to or more than 40 percent of the total
gross fair market value of (A) all of the assets of the Bank or Company, or (B)
the value of the assets being disposed of, either of which is determined without
regard to any liabilities associated with such assets.  For all
purposes hereunder, the definition of Change in Control shall be construed to be
consistent with the requirements of Treasury Regulation Section 1.409A-3(i)(5),
except to the extent that such regulations are superseded by subsequent
guidance.

       

      
        	
                 
      

              	
                (g)

              	
                Company
      Stock shall mean the common stock of the
  Company.

              


      

       

      
        	
                 
      

              	
                (h)

              	
                Disabled
      or Disability shall mean the
      Executive:

              


      

       

      (1)    is
unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death, or last for a continuous period of not less than 12 months;

       

      (2)    by
reason of any medically determinable physical or mental impairment which can be
expected to result in death, or last for a continuous period of not less than 12
months, is receiving income replacement benefits for a period of not less than
three months under an accident and health plan covering employees of the Bank;
or

       

      (3)    is
determined to be totally disabled by the Social Security
Administration.

       

      
        	
                 
      

              	
                (i)

              	
                Exchange
      Ratio shall mean the ratio used to determine the number of shares
      of common stock in a successor corporation each share of Company Stock
      will exchanged for in a Second-Step Conversion.  The Exchange
      Ratio will be determined as part of the independent valuation conducted in
      connection with the Second-Step
Conversion.

              


      

       

      
        
           


        

        
          3

          
            

          

        

        
           


        

      


      
        	
                 
      

              	
                (j)

              	
                Fair
      Market Value shall mean the per share closing price of Company
      Stock, as reported by the principal exchange or market over which the
      shares of Company Stock are then listed or regularly
    traded.

              


      

       

      
        	
                 
      

              	
                (k)

              	
                Involuntary
      Termination shall mean Separation from Service other than for Cause
      without the Executive’s express written consent and voluntary resignation
      due to a material diminution of or interference with the Executive’s
      duties, responsibilities and benefits as Executive Vice President of the
      Bank, including (without limitation) any of the following actions unless
      consented to in writing by the Executive: (i) a change in the principal
      workplace of the Executive to a location outside of a 30 mile radius from
      the Executive’s principal workplace as of the date hereof; (ii) a material
      demotion of the Executive; (iii) a material reduction in the number or
      seniority of other personnel reporting to the Executive or a material
      reduction in the frequency with which, or on the nature of the matters
      with respect to which, such personnel are to report to the Executive,
      other than as part of an institution-wide reduction in staff; (iv) a
      material adverse change in the Executive’s salary, perquisites, benefits,
      contingent benefits or vacation, other than as part of an overall program
      applied uniformly and with equitable effect to all members of the senior
      management of the Bank; and (v) a material permanent increase in the
      required hours of work or the workload of the Executive; provided that the
      Executive has notified the Bank of the existence of such a condition no
      later than 90 days after the initial existence of such condition and the
      Bank has at least 30 days to cure such condition. The term “Involuntary
      Termination” does not include termination for Cause or termination of
      employment due to retirement, death, Disability or suspension or temporary
      or permanent prohibition from participation in the conduct of the Bank’s
      affairs under Section 8 of the Federal Deposit Insurance
    Act.

              


      

       

      
        	
                 
      

              	
                (l)

              	
                Issue
      Price shall mean the initial offered price of the common stock of
      the newly formed successor corporation that is issued in connection with
      the Second-Step Conversion.

              


      

       

      
        	
                 
      

              	
                (m)

              	
                Monthly
      Benefit shall mean an amount, as of a Benefit Determination Date,
      equal to the vested Appreciation Benefit divided by 180.  For
      example, if on a Benefit Determination Date the Appreciation Benefit is
      $450,000, then Executive’s Monthly Benefit is $2,500 ($450,000 /
      180).

              


      

       

      
        	
                 
      

              	
                (n)

              	
                Normal
      Retirement Date shall mean the date the Executive attains age
      55.  The Executive may change his Normal Retirement Date
      provided that he files an election form with the Bank; provided, however,
      that: (1) the new election will not take effect until at least 12 months
      after the date the new election is filed; (2) the commencement of
      installment payments with respect to which such election is made must be
      deferred for a period of not less than five years from the date such
      payment would otherwise have been made; and (3) the new election is filed
      at least 12 months prior to the date of the first scheduled payment under
      the Plan.

              


      

       

      
        
           


        

        
          4

          
            

          

        

        
           


        

      


      
        	
                 
      

              	
                (o)

              	
                Second-Step
      Conversion shall mean the conversion and reorganization of Atlantic
      Coast Federal, MHC, the Company and the Bank from a mutual holding company
      structure to a fully public ownership
structure.

              


      

       

      
        	
                 
      

              	
                (p)

              	
                Separation
      from Service shall mean the date of cessation of the employment
      relationship (other than an approved leave of absence) between the
      Executive and the Bank and its affiliates and subsidiaries (including any
      successor in interest, if applicable), and shall be construed to comply
      with Code Section 409A and Treasury Regulations Section
      1.409A-1(h).

              


      

       

      
        	
                 
      

              	
                (q)

              	
                Specified
      Employee shall mean a key employee of the Bank within the meaning
      of Code Section 4l6(i) without regard to paragraph 5 thereof, determined
      in accordance with Code Section 409A and Treasury Regulations Section
      1.409A-1(i).

              


      

       

      
        	
                 
      

              	
                (r)

              	
                Stock
      Award Component shall mean the number of shares of Company Stock
      awarded to the Executive under the Atlantic Coast Federal Corporation 2005
      Recognition and Retention Plan that are still held by the Executive on
      December 11, 2009.

              


      

       

      
        	
                 
      

              	
                (s)

              	
                Stock
      Ownership Component shall mean the number of shares of Company
      Stock directly or beneficially owned by the Executive (as that term is
      defined in Rule 13d-3 under the Securities Exchange Act of 1934, as
      amended, disregarding any beneficial ownership of stock options) as of
      December 11, 2009.

              


      

       

      
        	
                2.

              	
                Payment
      of Benefits.

              


      

       

      
        	
                 
      

              	
                (a)

              	
                Normal
      Benefit.  If Monthly Benefits have not already started
      due to Separation from Service, Disability or Change in Control, the Bank
      shall pay the Monthly Benefit to Executive starting on the first business
      day of the month following the Normal Retirement Date and on the first
      business day of each calendar month thereafter for a total of 180 months
      (i.e., monthly payments for 15 years), regardless of whether the Executive
      has experienced a Separation from Service; provided however, that, if the
      Executive has experienced a Separation from Service, then, to the extent
      necessary to avoid penalties under Code Section 409A and the regulations
      thereunder, such payments shall not commence until the first day of the
      seventh month following the date of the Executive’s Separation from
      Service if the Executive is a Specified Employee on his date of Separation
      from Service.

              


      

       

      
        	
                 
      

              	
                (b)

              	
                Death
      Benefit.  If the Executive dies prior to the Normal
      Retirement Date, Separation from Service, Disability or Change in Control,
      the Bank shall pay to the beneficiary designated on Exhibit A, the
      Appreciation Benefit in a lump sum on the first business day of the month
      following the Executive’s death.  If no beneficiary or
      beneficiaries have been designated, or if all of the beneficiaries
      predecease the Executive, the Monthly Benefit will be paid to the
      Executive’s estate.

              


      

       

      
        
           


        

        
          5

          
            

          

        

        
           


        

      


      
        	
                 
      

              	
                (c)

              	
                Disability
      Benefit.  If the Executive becomes Disabled prior to the
      Normal Retirement Date, death, Separation from Service or Change in
      Control, the Bank shall pay the Monthly Benefit to him commencing on the
      first business day of the month following the date on which the Executive
      becomes Disabled and on the first business day of each calendar month
      thereafter for a period of 180
months.

              


      

       

      
        	
                 
      

              	
                (d)

              	
                Separation
      from Service Benefit.  In the event the Executive incurs
      a Separation from Service due to an Involuntary Termination before the
      Normal Retirement Date, Disability, death or Change in Control, the Bank
      shall pay the Monthly Benefit to him commencing on the first business day
      of the month following the Separation from Service and on the first
      business day of each calendar month thereafter for a period of 180
      months.  However, if the Executive is a Specified Employee on
      the date of his Separation from Service, such payments shall not commence
      until the first day of the seventh month following the date of the
      Executive’s Separation from
Service.

              


      

       

      
        	
                 
      

              	
                (e)

              	
                Change
      in Control Benefit.  If a Change in Control occurs before
      the Normal Retirement Date, Separation from Service due to an Involuntary
      Termination, Disability or death, then, within 30 calendar days after such
      Change in Control, the Bank shall pay the Executive a lump sum equal to
      the Appreciation Benefit.

              


      

       

      
        	
                 
      

              	
                (f)

              	
                Funding
      of Monthly Benefit. The Bank reserves
      the right to purchase a contract from a life insurance company with a
      minimum rating of AA from Standard & Poors and Moody’s in order to
      provide all or any portion of the Monthly Benefit described herein. Upon
      the Bank’s purchase of such contract and distribution of the contract to
      Executive or his Beneficiary, the Bank’s liability to provide the Monthly
      Benefit hereunder shall cease and such contract shall be the sole source
      of funds for providing such Monthly
Benefit.

              


      

       

      
        	
                 
      

              	
                (g)

              	
                Changes
      in Company Stock.  In the event of any change in Company
      Stock through stock dividends, split-ups, stock splits or reverse stock
      splits, recapitalizations, reclassifications, conversions or otherwise,
      then the Board will make appropriate adjustment or substitution in the
      aggregate value of the Prior Benefit Component, the Stock Award Component
      and the Stock Ownership Component.

              


      

       

      
        	
                3.

              	
                Required
      Provisions.

              


      

       

      
        	
                 
      

              	
                (a)

              	
                The
      Bank may terminate Executive’s employment at any time, but any termination
      by the Bank other than Separation from Service for Cause as defined above
      shall not prejudice Executive’s right to compensation or other benefits
      under this Agreement. Executive shall have no right to receive
      compensation or other benefits for any period after Separation from
      Service for Cause.

              


      

       

      
        
           


        

        
          6

          
            

          

        

        
           


        

      


      
        	
                 
      

              	
                (b)

              	
                If
      Executive is suspended from office and/or temporarily prohibited from
      participating in the conduct of the Bank’s affairs by a notice served
      under Section 8(e)(3) [12 USC §1818(e)(3)] or 8(g)(l) [12 USC §1818(g)(I)]
      of the Federal Deposit Insurance Act (the “FDI Act”), the Bank’s
      obligations under this Agreement shall be suspended as of the date of
      service, unless stayed by appropriate proceedings. If the charges in the
      notice are dismissed, the Bank may in its discretion (i) pay Executive all
      or part of the compensation withheld while its contract obligations were
      suspended and (ii) reinstate (in whole or in part) any of its obligations
      which were suspended.

              


      

       

      
        	
                 
      

              	
                (c)

              	
                If
      Executive is removed and/or permanently prohibited from participating in
      the conduct of the Bank’s affairs by an order issued under Section 8(e)(4)
      [12 USC §1818(e)(4)] or 8(g)(l) [12 USC §1818(g)(l)] of the FDI Act, all
      obligations of the Bank under this Agreement shall terminate as of the
      effective date of the order, but vested rights of the contracting parties
      shall not be affected.

              


      

       

      
        	
                 
      

              	
                (d)

              	
                If
      the Bank is in default as defined in Section 3(x)(l) [12 USC §1813(x)(1)]
      of the FDI Act, all obligations of the Bank under this Agreement shall
      terminate as of the date of default, but this paragraph shall not affect
      any vested rights of the contracting
parties.

              


      

       

      
        	
                 
      

              	
                (e)

              	
                All
      obligations under this Agreement shall be terminated, except to the extent
      determined that continuation of this Agreement is necessary for the
      continued operation of the Bank, (i) by the Director of the Office of
      Thrift Supervision (“OTS”) or his or her designee, at the time the FDIC
      enters into an agreement to provide assistance to or on behalf of the Bank
      under the authority contained in Section B(c) [12 USC §1823(c)] of the FDI
      Act; or (ii) by the Director or his or her designee at the time the
      Director or his or her designee approves a supervisory merger to resolve
      problems related to operation of the Bank or when the Bank is determined
      by the Director to be in an unsafe or unsound condition. Any rights of the
      parties that have already vested, however, shall not be affected by such
      action.

              


      

       

      
        	
                 
      

              	
                (f)

              	
                Notwithstanding
      anything herein contained to the contrary, any payments to Executive by
      the Company, whether pursuant to this Agreement or otherwise, are subject
      to and conditioned upon their compliance with Section 18(k) of the FDI
      Act, 12 U.S.C. Section 1828(k), and the regulations promulgated thereunder
      in 12 C.F.R. Part 359.

              


      

       

      
        	
                4.

              	
                Claims.  In
      the event a claim for benefits is wholly or partially denied under this
      Agreement, the Executive or any other person claiming benefits under this
      Agreement (a “Claimant”) shall be given notice in writing within 30
      calendar days after the Administrator’s receipt of the claim. For good
      cause shown, the Administrator may extend this period for an additional 30
      calendar days. Any denial must specifically set forth the reasons for the
      denial and any additional information necessary to rescind such denial.
      The Claimant shall have the right to seek a review of the denial by filing
      a written request with the Administrator within 60 calendar days of
      receipt of the denial. Such request may be supported by such documentation
      and evidence deemed relevant by the Claimant. Following receipt of this
      information, the Administrator shall make a final determination and notify
      the Claimant in writing within 60 calendar days of the Administrator’s
      receipt of the request for review together with the specific reasons for
      the decision.

              


      

       

      
        
           


        

        
          7

          
            

          

        

        
           


        

      


      
        	
                5.

              	
                General
      Assets and Funding. The amounts
      payable under this Agreement are payable from the general assets of the
      Bank and no special fund or arrangement is intended to be established
      hereby nor shall the Bank be required to earmark, place in trust or
      otherwise segregate assets with respect to this Agreement or any benefits
      hereunder. The Administrator reserves the right to determine how the Bank
      will fund its obligation undertaken by this Agreement. Should the
      Administrator elect to purchase assets relating to this Agreement, in
      whole or in part, through the medium of life insurance or annuities, or
      both, the Bank shall be the owner and beneficiary of each such policy
      unless otherwise provided by this Agreement. Bank reserves the absolute
      right, in its sole discretion, to terminate such life insurance or
      annuities, as well as any other investment program, at any time, in whole
      or in part unless otherwise provided by this Agreement. Such termination
      shall in no way affect the Bank’s obligation to pay the Executive the
      benefits as provided in this Agreement. At no time shall the Executive be
      deemed to have any right, title, or interest in or to any specific asset
      or assets of the Bank, including but not by way of restriction, any
      insurance or annuity contract and contracts or the proceeds
      therefrom.

              


      

       

      
        	
                6.

              	
                Certain
      Reductions. Notwithstanding
      any other provision of this Agreement, if the value and amounts of
      benefits under this Agreement, together with any other amounts and the
      value of benefits received or to be received by the Executive in
      connection with a Change in Control would cause any amount to be
      nondeductible for federal income tax purposes by the Bank or the
      consolidated group of which the Bank is a member pursuant to Section 280G
      of the Code, then amounts and benefits under this Agreement shall be
      reduced (not less than zero) to the extent necessary so as to maximize
      amounts and the value of benefits to the Employee without causing any
      amount to become nondeductible by Bank pursuant to or by reason of such
      Section 280G. The Employee shall determine the allocation of such
      reduction among payments and benefits to the
  Employee.

              


      

       

      
        	
                7.

              	
                Beneficiary
      Designations. The Executive
      shall designate a beneficiary by filing with Bank a written designation of
      beneficiary on a form substantially similar to the form attached as
      Exhibit A. The Executive may revoke or modify the designation at any time
      by filing a new designation. However, designations will only be effective
      if signed by the Executive and accepted by the Bank during the Executive’s
      lifetime. The Executive’s beneficiary designation shall be deemed
      automatically revoked if the beneficiary predeceases the Executive, or if
      the Executive names a spouse as beneficiary and the marriage is
      subsequently dissolved. If the Executive dies without a valid beneficiary
      designation, all payments shall be made to the Executive’s surviving
      spouse, if any, and if none, to the Executive’s surviving children and the
      descendants of any deceased child by right of representation, and if no
      children or descendants survive, to the Executive’s
  estate.

              


      

       

      
        
           


        

        
          8

          
            

          

        

        
           


        

      


      If a
benefit is payable to a minor, to a person declared incompetent, or to a person
incapable of handling the disposition of his or her property, the Bank may pay
such benefit to the guardian, legal representative or person having the care or
custody of such minor, incompetent person or incapable person, or to a custodian
selected by the Bank under the Georgia Uniform Transfers to Minors Act for the
benefit of such minor. The Bank may require proof of incompetency, minority or
guardianship as it may deem appropriate prior to distribution of the benefit.
Such distribution shall completely discharge the Bank from all liability with
respect to such benefit.

       

      
        	
                8.

              	
                Amendment
      and Termination.

              


      

       

      
        	
                 
      

              	
                (a)

              	
                Amendment. The Bank may at
      any time amend the Agreement in whole or in part, provided,
      however, that no amendment shall decrease or restrict the amount accrued
      to the date of amendment.

              


      

       

      
        	
                 
      

              	
                (b)

              	
                Termination. The Bank may at
      any time partially or completely terminate the Agreement, if, in its
      judgment, the tax, accounting, or other effects of the continuance of the
      Agreement, or potential payments thereunder, would not be in the best
      interests of the Bank.

              


      

       

      (1)    Partial Termination.
In the event of a partial termination, the Agreement shall continue to operate
and be effective with regard to benefits accrued prior to the effective date of
such partial termination, but no further benefits shall accrue after the date of
such partial termination.

       

      (2)    Complete Termination.
Subject to the requirements of Code Section 409A, in the event of complete
termination, the Agreement shall cease to operate and the Bank shall pay the
Executive his Account as if he had terminated service as of the effective date
of the complete termination. Such complete termination of the Agreement shall
occur only under the following circumstances and conditions.

       

      (A)     The
Bank may terminate the Agreement within 12 months of a corporate dissolution
taxed under Code section 331, or with approval of a bankruptcy court pursuant to
11 U.S.C. §503(b)(1)(A), provided that the amounts accrued under the Agreement
are included in the Executive’s gross income in the latest of (i) the calendar
year in which the Agreement terminates; (ii) the calendar year in which the
amount is no longer subject to a substantial risk of forfeiture; or (iii) the
first calendar year in which the payment is administratively
practicable.

       

      (B) The
Bank may terminate the Agreement within the 30 days preceding a Change in
Control (but not following a Change in Control), provided that the Agreement
shall only be treated as terminated if all substantially similar arrangements
sponsored by the Bank are terminated so that the Executive and all participants
under substantially similar arrangements are required to receive all amounts of
compensation deferred under the terminated arrangements within 12 months of the
date of the termination of the arrangements.


      
        
           


        

        
          9

          
            

          

        

        
           


        

      


      (C) The
Bank may terminate the Agreement provided that (i) all arrangements sponsored by
the Bank that would be aggregated with this Agreement under Treasury Regulations
section 1.409A-l(c) if any individual; covered by this Agreement was also
covered by any of those other arrangements are also terminated; (ii) no payments
other than payments that would be payable under the terms of the arrangement if
the termination had not occurred are made within 12 months of the termination of
the arrangement; (iii) all payments are made within 24 months of the termination
of the arrangements; and (iv) the Bank does not adopt a new arrangement that
would be aggregated with any terminated arrangement under Treasury Regulations
section 1.409A-1(c) if the same individual participated in both arrangements, at
any time within three years following the date of termination of the
arrangement.

       

      (D) The
Bank may terminate the Agreement pursuant to such other terms and conditions as
the Internal Revenue Service may permit from time to time.

       

      
        	
                9.

              	
                Miscellaneous.

              


      

       

      
        	
                 
      

              	
                (a)

              	
                Withholding.  To
      the extent amounts payable under this Agreement are determined by the
      Administrator, in good faith, to be subject to federal, state or local
      income tax, the Bank may withhold from each such payment an amount
      necessary to meet the Bank’s obligation to withhold amounts under the
      applicable federal, state or local
law.

              


      

       

      
        	
                 
      

              	
                (b)

              	
                Governing
      Law.  This Agreement shall be construed under the laws of
      the State of Georgia, except to the extent that federal law
      applies.

              


      

       

      
        	
                 
      

              	
                (c)

              	
                Future
      Employment.  This Agreement shall not be construed as
      providing the Executive the right to be continued in the employ of the
      Bank or its affiliates or
subsidiaries.

              


      

       

      
        	
                 
      

              	
                (d)

              	
                No
      Pledge or Attachment.  No benefit which is or may become
      payable under this Agreement shall be subject to any anticipation,
      alienation, sale, transfer, pledge, encumbrance or hypothecation or
      subject to any attachment, levy or similar process and any attempt to
      effect any such action shall be null and
void.

              


      

       

      
        	
                 
      

              	
                (e)

              	
                Successors
      and Assigns.  This Agreement and the obligations of the
      Bank herein shall be binding upon the successors and assigns of the Bank.
      This Agreement may not be assigned by the Bank without the prior written
      consent of the Executive or any other beneficiary receiving payments under
      this Agreement.

              


      

       

      
        	
                 
      

              	
                (f)

              	
                Participation
      in Plans.  Nothing contained in this Agreement shall be
      construed to alter, abridge, or in any manner affect the rights and
      privileges of the Executive to participate in and be covered by any
      pension, profit sharing, group insurance, bonus, incentive, or other
      employee plans which the Bank or its affiliates or subsidiaries may now or
      hereafter have.

              


      

       

      
        
           


        

        
          10

          
            

          

        

        
           


        

      


      
        	
                 
      

              	
                (g)

              	
                Notices.
      Any notices under this Agreement shall be provided to the Executive at his
      last address on file with the Administrator and shall be provided to the
      Administrator in care of President, Atlantic Coast Federal, 505 Haines
      Avenue, Waycross, Georgia 31501.

              


      

       

      
        	
                 
      

              	
                (h)

              	
                Headings.  Headings
      of sections herein are inserted for convenience of reference. They are not
      to be considered in the construction of this
  Agreement.

              


      

       

      
        	
                 
      

              	
                (i)

              	
                Savings
      Clause.  If any provision of this Agreement shall be for
      any reason invalid or unenforceable, the remaining provisions shall be
      carried into effect.

              


      

       

      
        	
                 
      

              	
                (j)

              	
                Entire
      Agreement.  This Agreement constitutes the entire
      agreement between the Bank and the Executive as to the subject matter
      hereof. No rights are granted to the Executive be virtue of this Agreement
      other than as specifically set forth
herein.

              


      

       

      
        	
                 
      

              	
                (k)

              	
                Suicide.  No
      benefits shall be payable if the Executive commits suicide within two (2)
      years after the date of this Agreement, or if the Executive has made any
      material misstatement of fact on any application for life insurance
      purchased by the Bank.

              


      

       

      
        	
                 
      

              	
                (l)

              	
                Top
      Hat Agreement.  For purposes of the Internal Revenue
      Code, the Bank intends this Agreement to be an unfunded, unsecured promise
      to pay on the part of the Bank. For purposes of ERISA, the Bank intends
      this Agreement to be an unfunded obligation solely for the benefit of the
      Executive for the purpose of qualifying this Agreement for the “top hat”
      exception under sections 201(2), 301 (a)(3) and 401 (a) of
      ERISA.

              


      

       

      The
parties have caused this Agreement to be executed and delivered as of the date
first above written.

       

      
        
          	 
      	 
      	
                  ATLANTIC
      COAST BANK

                
	 
      	 
      	 
      
	
                  December
      11, 2009

                	
                  By:

                	
                  /s/
      Robert J. Larison, Jr.

                
	
                  Date

                	 
      	
                  Name:
      Robert J. Larison, Jr.

                
	 
      	 
      	
                  Title:  President
      and CEO

                
	 
      	 
      	 
      
	
                   

                	 
      	
                  EXECUTIVE
      

                
	 
      	 
      	 
      
	
                  December
      11, 2009

                	 
      	
                  /s/
      Carl W. Insel

                
	 
      	 
      	
                  Carl
      W. Insel

                


        

         

        
          
            
            

          

          
            11